Posts Tagged ‘Fundraising and the Next Generation’

On the cusp of major change for nonprofits

generationgap2015

Special thanks to Thomas A. McLaughlin for this article. McLaughlin is the founder of the nonprofit-oriented consulting firm McLaughlin & Associates. He is the author of Streetsmart Financial Basics for Nonprofit Managers, 4th Edition (Wiley).  His email address is tamclaughlin@comcast.net. This article first appeared in The Nonprofit Times.

Lately when we have been facilitating a group at a conference we have made a point of asking the following two seemingly unrelated questions:

How old are you?

At what age do you expect to retire?

Before we move on, answer the two questions above for yourself (in an actual session, responders are asked not to print their names).  Think about the answers your parents’ and your grandparents’ generations would have given to the questions.  If we were able to go back in time it would be a virtual certainty that your answers would look very different from those of your parents and grandparents had they grown up in the United States.

While we do not yet have enough responses to claim a statistically valid group, the outcomes to date are worth examining.  Here are the averages of the responses we’ve received:

How old are you? 56

At what age do you expect to retire? 70

If these results remain consistent, it confirms that we are nearing the cusp of a major change in nonprofit organizations (not to mention the rest of the economy).   playbuzzIt won’t be business as usual as we near 2030, which seems to be the projected ‘average’ retirement year of our current 56 year olds.

Because the numbers of Baby Boomers born each year began to drop significantly in the early 60’s, the Gen X and Millennial generations will not come close to the Baby Boomers’ higher birth rates.  Kelly White Donofrio LLP writed in her blog that, we are already hearing about an unusual level of shortages of management candidates, not to mention a shortage of qualified Gen Xer CEOs.  Even entry-level candidates seem scarcer now than ever before.

Nonprofit employee trends aren’t the only ones due for some changes. Nonprofit entities themselves are another area where long-time patterns seem to be changing.  The number of active nonprofit public charities steadily grew from the 80s until 2010, when the upward trajectory abruptly decreased to about 2003 levels.

The pattern is probably not arbitrary.  In all likelihood, the recession that began in 2008 right after the Wall Street crash of 2007 had a tempering effect on the numbers of new nonprofits each year.  Organization creators that had already finished the application process and turned in their request for IRS approval may well have lengthened their intense startup phase, while other potential post-recession applicants for nonprofit status may have deliberately slowed their process in order to begin providing services once the economic conditions improved.  The recession may also have caused some to give up altogether.  Fortunately the upward trend appears to have resumed, although perhaps with less velocity.

Putting the Baby Boom into context reveals some hard-to-see advantages.  The biggest one is that the Boomers were the healthiest generation to reach retirement age.  Most of the Boomers reached full employment age at just about the time that hard physical labor began to decline as a major part of most jobs.  As a result, the Baby Boomers were the first
generation that didn’t have to work largely in the factories.   By the time that the first Boomers were ready to find permanent work, the factories had already begun migrating overseas.

As a result, the Boomers were the first generation in history to be able to work in non-physically stressful environments.   Improvements in health care, communications, education, and widespread motorized travel all contributed to far less physical decline than at any time in the previous two hundred years.

Overall Impactresearchimpactnetwork

Nothing brings as much pressure on a nonprofit organization as the lack of staff.   At the moment we infer from economic reports – and the firsthand observations of CEO’s and others – that the Boomers’ exits are already being felt on both ends of the generational spectrum.   Naturally the first shortage is likely to be felt in the executive ranks as those individuals either reach their preferred retirement age, or move on, but there are also staff shortages in direct care.

Fortunately there are a few sources of labor (and optimism), many of which relate to immigration.  For example, the Pew Charitable Trusts report that the foreign-born U.S. population grew 109% between 1990 and 2012 (the overall impact of immigration varies significantly in different parts of the United States).   Moreover, the Pew Charitable Trusts quote Census Bureau projections that net international immigration will be the major driver behind US population growth between 2027 and 2038.

What Can be Done

If the shortage of available employees follows the predicted trend lines above, it could affect virtually all nonprofits in the country.  A major part of the pressure will come from the fact that the birthrates of bothdhmh-maryland-gov the latter part of the Gen Xers’ generation and all of the Millennials’ generation are half that of the Boomers’, so today’s status quo will eventually feel more like the status squeezed.

If we are right about our analysis, this situation will evolve relatively slowly over a period of time, which should make it easier to accommodate but harder to recognize.  Start your strategy planning now so that it fits the circumstances before you feel the squeeze.  Here are some suggestions:

Re-Work Your Staffing Patterns slantimage

If you are feeling the pressure at the bottom of your workforce as well as at the top, it’s time to re-think your staffing patterns.  While we have no way of proving this, it would not be a surprise if your underlying assumptions about direct care workers are still embedded in the 1980 to 2000 era.   And while you’re doing this, be sure to apply the same scrutiny to your assumptions about your senior-most executives.  Do you really need a CIO and his full staff now that you have that 24-hour technology company on call?

Re-Think Your Service Models seedshakers

If you don’t already know the year your nonprofit was founded, pull out your most recent IRS Form 990 and look exactly three inches below the word ‘income’ as in ‘Return of Organization Exempt  From Income Tax’.  You’ll find a box labeled ‘L’ and the words Year of Formation followed by the four digit year of your corporation’s founding.  If your organization was founded in the two or so decades since 1970 there is a chance that the organization is still at least partially grounded in that era.  That could mean that some of your service models are similarly aged.    

Consider a Merger

One way to accommodate the realities of the 21st century is to grow your scale.  The combination of declining birth rates (labor) and steady needs for service (aging clients with longer lifespans) will put pressure on many nonprofits.   Lately we have detected less instinctive opposition to mergers than had been true in the past, suggesting that this opposition might lessen.  The advantage of larger scale operations run correctly is that the resulting efficiencies – one ‘back room’, one Human Resources department, etc. – can strengthen the entire organization.

Today’s U.S. economy has never had aging baby boomers like we see today, nor a 50% drop in birthrates.   Navigating the next two or three decades will force many nonprofits to change their models and to try different approaches.   Being wanted will be just part of the terrain.

See book summaries related to this topic:

Nonprofit Mergers and Alliances by Thomas McLaughlin

Fundraising and the Next Generation: Tools for Engaging the Next Generation of Philanthropists

Working Across Generations: Defining the Future of Nonprofit Leadership

Cause for Change: The Why and How of Nonprofit Millennial Engagement

Image credits: researchimpactnetwork, dhmh.maryland.gov, slantimage, seedshakers, and playbuzz

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Multichannel efforts: Your path to social change

“Social media is a tool, not the tool with Gen X and Millennials,” said Fundraising and the Next Generation author and consultant, Emily Davis. I hosted Davis at a live author interview for the Colorado Nonprofit Association’s fall conference yesterday and whenever we discuss fundraising with younger generations, social media inevitably comes up. Other questions that always surface are about what platforms to use, what social media preferences these generations have and so on. In short, there’s still a lot of uncertainty about the best use of our time online with our nonprofit communities. On the heels of this session with nonprofit leaders, I’m pleased we can offer our latest book Page to Practice™ feature about creating change through multichannel efforts.

The authors of Social Change Anytime Everywhere challenge those of us who are setting up one or two online profiles and calling it good. Social networks such as Facebook, YouTube and Twitter are among the top five ranked websites for traffic in the U.S. More than 5.2 billion people have mobile accounts, which means there are five times as many mobile phone subscriptions as there are personal computers or landline phones.

With jaw-dropping statistics like these and many more, coauthors Allyson Kapin and Amy Sample Ward establish that online multichannel efforts are a necessary bridge between you and the bright future for your cause. With literally dozens of illustrative examples, case stories and specific guidance, the authors describe how you can boost fundraising, spark advocacy and build community with a multi-pronged approach. They explain how you can earn the collective support of everyone in your organization—even the critics—as well as actualize your online plans.

Kapin and Sample Ward

I asked Allyson Kapin about how the book adds to the discussion about social media efforts:

CausePlanet: With a wealth of rhetoric and written material about social media, what do you want readers to know about how your book uniquely adds to the discussion?

Kapin: Social media is not a silver bullet for fundraising. It’s also not a replacement for your website, email or direct mail list. It’s one of multiple channels that organizations should be using to engage their communities. It’s important that organizations integrate these channels into their communications and outreach efforts. They should not be siloed.

Join us next week when we’ll highlight why Allyson Kapin and her coauthor, Amy Sample Ward explain why nonprofits should adopt a start-up mentality when trying to instigate social change.

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Conference generates great “next gen” ideas

What do you get when you combine standing-room-only attendance, one enthusiastic author and the topic of generational fundraising? You have the makings of a terrific exchange of ideas. I had the pleasure of conducting a CausePlanet interview with Emily Davis at the United Way Worldwide Conference in Indianapolis, Indiana this week. Davis’ book, Fundraising and the Next Generation: Tools for Engaging the Next Generation of Philanthropists, was the basis of our discussion.

As some of you know, the CausePlanet author interview is an interactive format where attendees are encouraged to join in by submitting questions and comments for the author along with me. This particular group had some great input that enhanced our discussion about integrating Gen X and Y into your strategic resource planning. A variety of strategies were discussed during the interview and I wanted to pass along two in particular.

Consider these strategies:

Look at your Traditionalists (born 1900-1945) and Boomers (born 1946-1964) and research their family members: Who among these generations is supporting your organization? Do they have children you can involve on a volunteer basis so when they reach their giving years, they’re ready to give? You can’t afford to dismiss the younger philanthropists because their gifts may be smaller. In reality, Davis’ research demonstrates how the younger generation is giving amounts relatively equal to generations that have preceded them. Furthermore, around 63 percent of Davis’ respondents report their financial contributions are affected by where they volunteer.

Consider forming a parent/child program: Another interview attendee explained how he had formed a program that involves fathers and sons working together on behalf of the cause. More than 70 million people are under the age of 30, rivaling Boomers in purchasing and voting power. Generation X and Millennials were raised on community service so they’re going to be receptive to an opportunity to volunteer especially when it involves the added value of family time. While mothers and fathers are more accustomed to traditional forms of giving, their children may have the financial means to deliver a large check or raise larger numbers of smaller donations from their peers, friends, and family through the simple click of a button. Together, these family teams can be an incredible resource.

In light of the fact that Millennials outpace Boomers in size and anticipated wealth, what are you doing to prepare and engage Generation X and Millennials now?

Follow this discussion online, read Davis’ blog or purchase her book at www.emilydavisconsulting.com

Or, you can purchase a Page to Practice summary of Davis’ book or numerous other titles in our CausePlanet store or subscribe for complete access to our summary library.

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Lifelong giving begins in the 30s

I just had the pleasure of co-hosting our latest virtual book club, Management Cafe, and wanted to remind you of three take-aways that came up in our conversation about working with the next generation. Author Emily Davis and her book, “Fundraising and the Next Generation” was featured. Emily reminded everyone on the call that:

Lifelong giving begins in the 30s. Because Gen Y or Millennials view volunteering as an additional form of philanthropy, this is a great entry point for organizations. Consider how you’ll engage your 20- and 30-somethings now so you have them connected to your cause throughout their lifetime. If you don’t have services that naturally translate to volunteer work, recruit a committee of Millennials plan a social event in support of your cause and build from there.

Nonprofits make the mistake of launching their presence on social media channels as a way of connecting with the younger set and calling it good. While social media is a natural tool to consider for engaging Gen Y or Milliennials, Davis reminds us that social media is a tool, not the tool. Be sure to blend your social media activity with other forms of communication and engagement.

This is the first time we’ve had all four generations in the nonprofit space (Traditionalists, Boomers, Gen X and Gen Y). Look around your office and consider who you have in-house to offer feedback about what each generation prefers with supporting causes they care about. When creating your plan, remember Traditionalists, for example, prefer a well-written letter while Boomers were influenced by the onset of television.

Read more about Emily’s fundraising recommendations in her book by visiting www.wiley.com or downloading our Page to Practice summary at the store or through a subscription. If you’re interested in learning more about Management Cafe, visit the Nonprofit Cultivation Center.

See also:

More articles about generational issues and nonprofits

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12 tips for starting your fundraising committee

In light of our recent Page to Practice feature of Emily Davis’ Fundraising and the Next Generation, I thought you’d enjoy her recent blog about the twelve steps involved with starting a fundraising committee.

Frequently, I’m asked about steps nonprofits can take in starting a nonprofit fundraising committee. Below are some ways that you can start out in organizing a team of volunteer fund raisers for your organizational mission.

1. Have a committee description. How can volunteers know what you need them to do without instruction? Start with a committee description that includes as much detail as possible like committee activities, meeting times and length, preferred skills and qualifications, and any other logistics you would want to know if you were joining the committee.

2. Be clear about your committee name. The words “fundraising” and “committee” can scare some people away. Another option is to call your committee the “Resource Development Team.” It sends a slightly different message that this is a team of leaders who are leveraging not just dollars, but also resources of all kinds for the mission and cause.

3. Identify board leadership. One of the best practices in nonprofit leadership is to make sure that your organizational any committees are led by active board members. Board members serve as ambassadors for your organization – both with internal and external networks. Having board members lead committees allows there to be seamless connection between the board and committees with communications, activities, reporting, etc.

4. Share your Fundraising Plan. Every organization should have a plan for their resource development strategies, whether it is a simple or a complex plan. Share that plan with your Fundraising Committee and ask them to provide feedback as well as take specific projects. Review the plan annually and find out what worked well, which goals need to be amended, and what just is not realistic. The plan helps with measurement and evaluation as well.

5. Provide staff support. Do not expect that you will create a Fundraising Committee and they will magically begin fundraising millions of dollars. Very few people are fundraising experts, so realize your staff is going to be the key to the committee members’ successes in many ways. Your staff is on the ground and working with stakeholders every day. Create opportunities for the staff to share and support the committee’s efforts. Train staff members how to lead, not just manage, the committee. Leaders breed leaders – this is a great opportunity for staff members to support and engage volunteers in a leadership capacity.

6. Offer trainings. Other ways to support your committee is to provide them with in-service trainings or share regular training opportunities through other organizations like your local nonprofit association. Investing small amounts of money in trainings can have a great return on investment in terms of fundraising from your committee members. It also shows a value in the committee members and your appreciation for their volunteer work. Read the next six steps at Davis’ blog.

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Join us for a “next gen” interview with Emily Davis

CausePlanet subscribers: Join us for our CausePlanet author interview series with Emily Davis on June 14 at 1 p.m. CST.  “Fundraising and the Next Generation: Tools for Engaging the Next Generation of Philanthropists” is Davis’ new book that will have you re-examining your prospect profiles.

Generation Y (a.k.a. Millennials) represent the largest population since Boomers. Cultivating these young prospects now and long term as they mature and have more to give is a revenue game changer for fundraisers. What are you doing to address this burgeoning donor constituency? Bring your questions for Davis to the interview or submit them when you register.

We look forward to touching on the book’s highlights through your questions:

• Explore how your organization can better use the next generation of volunteers to support your mission.
• Gain insight into the motivations and opinions of “next-gen” donors to help expand your fundraising focus.
• Ask hard questions and integrate strategies that better serve your organization’s mission for long-term sustainability.
• Find out how to engage your staff and volunteers in conversations about fundraising across generations.

How do CausePlanet subscribers register? Log in at the CausePlanet home page and click on the red link in the subscriber announcements page. If you have a question for Davis, don’t forget to submit one in the registration form. Subscribers can also download our new Page to Practice summary of her book beforehand. Posting soon!

Emily Davis has been working in the nonprofit sector as an executive director, staff member, consultant, founder, board member, and volunteer for over 15 years. She currently serves as the President of EDA Consulting in addition to many board and advisory roles in Colorado as well as nationally. She trains and consults on a number of different areas including board development, online communications, multigenerational philanthropy, and fundraising. Her passion for effective leadership has garnered numerous awards and nominations. Emily received her master’s degree in nonprofit management from Regis University.

Here’s what a recent author interview attendee had to say:

“Another outstanding presentation! CausePlanet has done an excellent job bringing together the experts and the audience for a genuinely interactive event packed with useful information. The opportunity to present questions beforehand and also to pose them live during the webinar is a unique feature that would enliven any topic. Absolutely recommended.

Matt Mullenix, Vice President of Public Relations, LANO

See also:

Liquid Leadership

Working Across Generations

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